Friday, June 29, 2012

Health Care REITs (Video)

Dow Chemical moving research to Collegeville

"Taking advantage of vacated drug-research labs and offices about 15 miles away, Dow Chemical Co. will relocate 800 employees in its Spring House campus in Montgomery County to a Pfizer facility in Collegeville.

The plans had been rumored for months, and employees will begin moving in January. Dow, based in Midland, Mich., purchased Rohm & Haas in a highly contentious deal in the midst of the financial crisis of 2009. Rohm & Haas' research labs had been based in Spring House since 1963.
Dow has no current plans to add jobs to the research operation, which is now part of its Advanced Materials division. But Dow indicated Thursday that the new facility would provide room for expansion. Advanced Materials is leasing 750,000 square feet in Collegeville. Pfizer, a global drug company, is maintaining operations in some parts of the facility.
"This strategy bolsters our company's long-standing commitment to Pennsylvania by putting our R&D operations on a long-term path forward," said Jerome Peribere, executive vice president at Dow and chief executive officer of Advanced Materials, which is based in Philadelphia.
The Spring House facility has developed paints, coatings, laundry detergents, water-purification products, shampoo, and conditioners.
Dow chief executive officer Andrew N. Liveris said the Pfizer facility was a "premier new location" and would provide Dow's "world-class researchers with a new collaborative and innovation-centric space."
Advanced Materials spokeswoman Lindsay Torriero said the division's headquarters employees would remain in the former Rohm & Haas headquarters on Independence Mall, a building with gracious Plexiglas chandeliers in its lobby. Rohm & Haas commercialized Plexiglas.
Dow considered several options for its research operation in the Philadelphia area, including modernizing Spring House, Torriero said.
A commodity-based chemical-manufacturing company, Dow has told financial analysts that Rohm & Haas would allow it to develop higher-margin specialty chemicals. Torriero described the Collegeville lease as "long term," but did not disclose the number of years."

Wednesday, June 27, 2012

Brandywine Realty Trust plans apartments on 3 big ex-office sites

by Joseph N. DiStefano

Brandywine Realty Trust, the Radnor landlord that controls half the high-end office towers in Center City, plans to fill vacant city and suburban space with apartments:
1) "1919 Market, which is owned through a 50/50 joint venture with [Independence Blue Cross] will include 292 market-rate apartments and 55,000 sq. ft. of retail, and is expected to be delivered by 4Q’14," writes Daniel P. Donlan, real estate analyst at Janney Capital Markets, in a report to clients this morning after Brandywine bosses met with investors.
The move accelerates the expansion of residential development into the Market Street office tower district west of City Hall. The vacuum created by weak office demand since the mid-2000s has also attracted the Liberty 2 office-to-condo conversions, the Murano condos and developer Ron Caplan's residential redevelopment of the former AAA insurance building.
2) "At Cira Centre South, which is located in University City (proximate to both University of Pennsylvania and Drexel campuses), management intends to take advantage of the high demand for both market-rate and student housing by building a mixed-use residential development through a [joint venture] with another public company," timetable TBD, Donlan added.
Brandywine's plan for a Cira II office tower (in a tax break zone south of its successful Cira I near its renovated 30th Street Post Office and new parking garage) fell through in the 2008+ collapse, but the company has increased its west-of-Schuylkill holdings by foreclosing on a Market Street office building.
3) "On the Plymouth Meeting site, the REIT plans to enter into a JV agreement for a 400-unit apartment development."
Donlan added: "Additional land parcels in New Jersey and Pennsylvania are currently undergoing planning and zoning for residential, hotel, and mixed-use, or for potential sale."
Office rents in the region are still so weak (stuck in the $20s/sq ft range for high-end space, same as 10 and 20 years ago) that there's little economic justification for new construction (which costs in the $40s/sq ft and up).
But demand for rental apartments in Center City and other parts of Philadelphia is on the rise. Donlan cites three groups of tenants: "empty nesters" who still work in the city or have retired and sold their larger suburban homes; recent college graduates who don't own cars; and, "as people are waiting longer to get married, they are staying in the city longer."
"The continuing diversification of downtown land-use is good for Center City," said Paul Levy, who runs the Center City District, which assesses a tax on downtown properties for sidewalk cleaning and other services the city doesn't provide. "It strengthens the live-work environment, since between 40% to 50% of downtown residents work downtown. It helps animate the streets at night and creates more demand for Center City retail.
Most importantly, the more diverse the downtown has become, the more we have retained real estate values – the assessed value of property within the Center City District, which represents about 22% of the assessed value of all property in the city, has gone up every year during this recession.
"So diversification pays dividends. Now if the City would also start reducing the wage and businesses taxes, there would also be demand for more downtown office space."
The Janney report says Brandywine data projects its office rents will grow around 3%-5%/year in its Philadelphia-area and Texas markets -- an improvement over recent years -- but still face weaker demand in New Jersey, Wilmington, Washington DC and Virginia.
Brandywine is expected to sell about $175 million worth of property this year (including recent sales in northern California) while investing around $84 million in acquisitions (including a deal with Allstate Insurance to buy half a million sq ft of 1980s-era buildings in Silver Spring, Md.)

Monday, June 25, 2012

Featured Listing 2,000sf Conshohocken Office Sublease!!!

We have a new 2,000sf office sublease in the Spring Mill Corporate Center, 1100 E. Hector St, Conshohocken, PA 19428. This is immediately available. It has 4 offices, a reception area, kitchenette, IT closet, open area for conference table or cubes. This has a great natural light window line. Spring Mill Corporate Center is right off of the SEPTA R6 line and across the street from a 360 unit brand new apartment complex. Flyer: or click the pic. Call (610) 616-4604 or

Tech employer quits KofP for Conshy tower

 by Joseph N. DiStefano
"NextDocs, the growing pharmaceutical clinical-testing compliance software company founded by Microsoft veteran Zikria Syed nine years ago, is leaving its offices at Brandywine Real Estate Trust's 500 North Gulph Rd., King of Prussia and moving with around 100 employees to 30,000 sq ft at Oliver Tyrone Pulver Corp.'s Six Tower Bridge in Conshohocken.
"NextDocs chose the property due to its centrallized location" closer to Philadelphia and the "live-work-play lifestyle" the building offers, as well as "the quality of the building."

NextDocs employs 126, including 85 at the headquarters. The company is hiring and expects to boost total employment to 160 by year's end, says spokesman Matt McLoughlin."

Friday, June 22, 2012

Sprawling warehouses proposed in Upper Macungie

"A commercial real estate company that has been selling suburban offices and investing in industrial property wants to build two sprawling warehouses in Upper Macungie, its latest projects in a recent Lehigh Valley building spree.
Officials with Liberty Property Trust went before the Upper Macungie Township Planning Commission Wednesday night to propose building two 1-million-square-foot warehouses on more than 200 acres on the Air Products campus off of Mill Creek Road. Who would occupy the buildings has yet to be determined.

Based in Malvern, Liberty Property Trust owns 595 industrial and office properties totaling 65.1 million square feet, including several industrial properties in the Lehigh Valley. The company has been on a speculative building spree in the Valley, beginning projects before it has tenants lined up.

Such speculative construction has been rare since the Great Recession hit, since commercial property owners struggled to keep properties full and didn't want to add space in a soft market.
But Liberty has launched an aggressive building campaign. The Upper Macungie projects come on the heels of new warehouses in Lehigh Valley Industrial Park VII in Bethlehem.

Pete Reinke, vice president of regional development at Lehigh Valley Economic Development Corp., said commercial landlords have to build properties before they have tenants because companies have to make decisions quickly about where to locate. Prospective tenants can't wait several months to a year for a building to be constructed, he said. They want to know what is immediately available.

Ken Molony, director of community development for Upper Macungie Township, said Liberty Property representatives, who presented a sketch plan Wednesday, could not say how much traffic the warehouses are expected to generate.

"The biggest hurdle will be solving the traffic issues," said Molony, adding that the project is in its early stages. "No one knows yet what kind of traffic impact it would bring."

Liberty has been shedding office space and investing in industrial properties. In April, the company sold for $49 properties for $195 million, mostly office buildings, in Wisconsin, Maryland, Virginia, North Carolina and New Jersey."

Wawa store, Chick-Fil-A approved by the supervisors for DeKalb Pike

"A proposed super Wawa convenience store with 16 gasoline pumps and an adjacent Chick-Fil-A restaurant was approved Thursday night by the Board of Supervisors in a 4-to-0 vote.

Supervisor Gregory Philips was absent.
The plans were first submitted in July 2011 by Goodman Properties for the 4.1-acre parcel at 145 W. DeKalb Pike. It is currently occupied by a former Petco building.
A ‘partial’ traffic light at the driveway entrance and two upgraded traffic lights on South Henderson Road at the intersections of Monroe Boulevard and Saulin Boulevard will be installed. The entrance traffic light will allow in-bound left turns into the driveway.
The Wawa building will have 8,601 square feet and eight islands with 16 gasoline pumps. The 142-seat, Chick-Fil-A building will have 4,864-square-foot with a drive-thru window, two ordering stations and outdoor seating on the northern side of the property.
Township Planner Robert Loeper said the Zoning Hearing Board had granted several variances. Attorney Robert Kerns, representing Goodman Properties, said the firm had agreed to all the township conditions.
“Clearly the greatest issue was traffic and access. There will be a partial signal allowing entrance into the site that can be expanded into a full signal later,” Loeper said. “The parking will conform to code regulations. This is a review that has taken a great deal of time.”
In a July 15, 2011 decision, the Zoning Hearing Board granted variances to allow gasoline sales in the C-1 district, 143 parking spaces and 591-square-feet of signs when the maximum allowed was 200-square-feet. On Aug. 3, 2011, the zoning board allowed an additional common sign for four adjacent properties including Wawa and Chick-Fil-A.
Solicitor Joseph McGrory Jr. said that the approval was made contingent on the Upper Merion Township Transportation Authority determining the amount of the Highway Traffic Capital Improvement Assessment Agreement fee. The traffic impact fee will be based on 421 new “p.m. peak hour” trips” minus reductions for new pass-by trips, according to the resolution.

A building permit will not be issued until the traffic impact fee has been agreed to by Goodman Properties.
Supervisors’ Chairwoman Erica Spott said, “I think we came to a better plan.”

“This is a very challenging property. We have to go into this knowing that this is going to be a tight project,” said Supervisor William Jenaway, “and that the signage will generate more lighting.”
Supervisor Greg Waks asked the developer when the project would begin and when it would be completed
Bruce Goodman, the owner of Goodman Properties, said the project could be complete within a year.
During public comment resident Terry Kelly said, “I’m hearing this is a half light but you recognize that you need a full traffic light? You should have a full light first.”
Spott replied, “PennDOT (Pennsylvania Department of Transportation) is agreeable with a half traffic light. We will watch the traffic generated by this. This board shares that concern. We had many meetings about our concerns. Route 202 is a state highway and we have no option but to deal with PennDOT. We will have to go back to them within three years. It is going to be a challenging area.”
Supervisor Carole Kenney said that PennDOT officials did not want to allow any traffic light at the initial meetings.
“We will have traffic studies and we will go back later to PennDOT,” Kenney said.
A $2,693 fee will be made in lieu of dedication for the required open space for the project. Six waivers for the location of landscaping were granted by the board."

Apartment complex on Market put on the market

by Natalie Kostelni
"Thomas Properties Group Inc. wants to shrink its Center City presence and to do so it has put up for sale an apartment building and a nearby undeveloped parcel.
The apartment building at 2121 Market St. is owned in a partnership with PMC Group, which joint ventured to convert it in 2001. The eight-story, 186,000-square-foot building has 168 loft apartments that have a monthly rent range of $1,250 to $1,850. Its occupancy is around 98 percent. The building has 24,000 square feet of retail space split between a Trader Joe’s and Daroff Design’s offices. The building could go for more than $45 million.
The decision to sell is an “opportunistic one,” said Randall L. Scott, executive vice president at Thomas Properties. “Neither the partnership or [Thomas Properties] are under any pressure to sell. If our instincts prove correct, that there is strong investor demand and pricing for well-located multifamily properties in Philadelphia, then we will sell. If not, we won’t.”

"Pension fund advisers, they love Center City Philadelphia, insurance companies – the building is fully sprinklered – and private equity [firms],” McFadden said.
The structure had been used by After Six Inc. as a factory for its formalwear business. It languished for more than a decade as a vacant building before Thomas Properties and PMC Group plowed $25 million to transform it. The project took advantage of a 1997 ordinance that provided a 10-year property tax abatement when developers transformed old Class B and Class C office buildings into apartments. It was part of a wave of similar conversions at the time."
Full story:

Glassboro making inroads on massive development

 by Natalie Kostelni
"Another round of construction is set to get under way this summer on Rowan Boulevard, a bold, $300 million multidimensional redevelopment project that aims to revitalize this South Jersey borough.
Work is soon to begin on a four-story, 100-room, full-service Courtyard Marriott, a 50,000-square-foot building that will house the College of Graduate and Continuing Education for Rowan University and have 17,000 square feet of retail on the ground floor as well as a 1,200-vehicle garage. Sometime this summer, a request for proposals will be issued for another phase of Rowan Boulevard that will entail constructing a four- to five-story mixed-use building that will include retail and market rate multifamily housing. Also in the works are additional RFPs for a mixed-use project with street-level retail and senior housing as well as the landscaping and design of a 1.5-acre town square.
“It’s a huge economic driver not only for Glassboro but for our region,” said Heather Simmons, a Gloucester County freeholder. “The success of this is pivotal.”
The project is the largest municipal renewal project in the works in New Jersey. It began in 2008 with a vision unveiled by borough and Rowan University officials to create a vibrant, mixed-use development on 26 acres that connected the university with the rest of the town. It has taken some time but has progressed.
Glassboro spent $22 million and about two years buying 90 properties that it assembled for the tract where Rowan Boulevard is taking shape. A partnership between Rowan and Glassboro was formed to envision what was needed such as student housing, retail that catered to the community as well as students, restaurants, open gathering spaces, a book store, hotel, market rate as well as senior housing so that multigenerational residents were part of the community bringing different buying power and cycles to keep the retail scene vibrant. Four distinct though complementary districts were demarcated.
About $100 million in projects have so far been constructed during the last four years."...
Full story:

Center City buildings meet a variety of different fates

by Natalie Kostelni
"Several Center City office buildings that were up for sale last year have met different fates.
Most have not sold and managed to refinance their loans. The exception is Two Penn Center.
Two Penn Center, which was briefly taken off of the market, is now up for sale again and under agreement, according to sources in the real estate market familiar with the transaction. A deal is under negotiation that, if successful, would transfer control of the office tower to ASI, a Philadelphia company operated by Alex Schwartz.
Two Penn was the first office building to come up for sale early last year after property owners sat on the sidelines for three years without putting any significant downtown properties on the market. When the building was first on the market, a deal with ASI had been in the works but never fully materialized. Between then and now, a new $52 million loan was arranged on the building that comes due in May 2021 and a series of leases were completed that helped fill some of its vacancy. The building is occupied with a lot of smaller tenants, many of which are law firms that want to be in close proximity to the criminal justice center and City Hall.
Two Penn had been up for sale for an estimated $65 million and is expected to trade for that amount.
New York-based Crown Properties Inc. bought Two Penn, a 505,000-square-foot 20-story building at 1500 John F. Kennedy Blvd., in 1997 from a Dutch pension fund for $33.5 million. Crown had tried to sell the building in 2001, during another recession, but took it off the market when a deal never happened.
In spring 2011, two neighboring properties, the Curtis Center and the Public Ledger Building, went up for sale. The Public Ledger has since been pulled and its loan in special servicing.
The Curtis Center had been under agreement by an investor and a deal was expected to be wrapped up by year end, according to people familiar with the situation. When it became apparent the transaction wasn’t going to get completed, Apollo Real Estate, which controls the property, decided to try to get the loan on the property refinanced. A $95 million permanent loan was lined up. JP Morgan provided the floating-rate loan and Jones Lang LaSalle secured it."
Full story:

Wednesday, June 20, 2012

Campbell Soup Company Acquires Office Building for $3.5 Million

EDS Investments, LLC, a subsidiary of Campbell Soup Company, purchased the office building at 1300 Admiral Wilson Blvd in Camden, NJ from Ilan Zaker for $3.5 million, or about $29-per-square-foot. The building will be demolished as a part of the Gateway Redevelopment Plan.

The 120,000-square-foot office building was constructed in 1927 and renovated in 1995. It is in the North Camden County submarket.

The Greentree Building Exchanges Hands for $9.8M

Stancato-Abdala Greentree Associates, LLC sold the 64-unit Greentree Building to Cornerstone Communities, LLC for $9.8 million, or about $153,000 per unit.
Located at 101-113 N. High St. in West Chester, PA, the 64-unit, five story apartment building totals 76,303 square feet, in which 17,500 square feet is street level retail space. The apartment amenities include a business center, fitness room, club room, and an outdoor patio.

Tuesday, June 19, 2012

Office tenants have the real estate advantage, analyst says

by Joseph N. DiStefano, Philadelphia Inquirer

Commercial-real-estate pros have been reduced to playing "musical chairs" as tenants enjoy their pick of nicer, cheaper offices instead of having to build or lease new space, analyst John W. Guinee writes in a report to clients of brokerage Stifel Nicolaus & Co.
Almost the only places in America where office demand and rents are rising are three hopping "media, entertainment and technology" centers: Silicon Valley; New York City's Midtown South (including "Silicon Alley"), and San Francisco's South of Market (SoMa).
Office space in midtown Manhattan is renting in the $45-$65-per-square-foot range, double or more what space fetches in Center City. (That explains why the big University City institutions, Penn, Drexel, CHOP, are expanding east across the Schuylkill.) In lower Manhattan's Wall Street financial district, leasing remains "slow."
Washington, D.C., was the only growing metro property and jobs market back in 2009, when President Obama and his Democrats were pushing "stimulus" programs. But "we are relatively pessimistic" about metro Washington now, given Iraq and Afghanistan war cutbacks and the prospect of a Republican sweep in November — or continued divided government — that "would likely result in Federal budget cuts," Guinee adds.
Brandywine Realty Trust, Radnor, has suffered with the "soft" Washington and Philadelphia markets; growth, "if any, [will] come from occupancy gains" (its current vacancy rate is about one-eighth) "and not from rental rate growth," except maybe at the popular Radnor Financial Center, Guinee writes. And Philadelphia's Liberty Property Trust is "shifting" out of small-market offices and into warehouse and industrial properties.
Maybe that's the future: With finance and government remaining weak, warehouse and distribution companies (think have "decided to ignore the global economic noise and proceed with running their businesses," Guinee concludes.

Walnut Place Set for Redevelopment

312 Walnut Street Associates acquired the six story property known as Walnut Place for $5.1 million, or about $74 per-square-foot.

The property was sold by as a joint venture of The 320 Company and The Archdiocese of Philadelphia. It has a land area of 269,780 square feet and was constructed in 1926. The interior improvements have been demolished and removed leaving an open lay-out plan. The buyer plans to redevelop the property into a multi-family building.

Monday, June 18, 2012

University of Pennsylvania expanding east of the Schuylkill

"The University of Pennsylvania is unveiling development proposals for 23 acres it purchased from the DuPont Co. — its biggest acquisition east of the Schuylkill — while continuing to grow the main campus in West Philadelphia with new buildings, more green space, and better linkages to Center City.

Penn bought for $13 million the former DuPont Marshall Laboratory at 34th Street and Grays Ferry Avenue in September 2010, and almost immediately relocated its transit operations there. On a surface lot where its buses and cars had parked at 32d and Walnut Streets, glass is now going up on an 80,000-square-foot nanotechnology center scheduled to open next year.

University trustees on Thursday were updated on plans for the former Marshall Lab site and on the next phase of the university's 20-year, multibillion-dollar campus development plan, which began in 2006 with Penn's acquisition of 24 acres from the U.S. Postal Service along the Schuylkill.

Penn president Amy Gutmann told trustees that the Marshall Lab property has "infinite possibilities" as a place to nurture start-up businesses and "technology transfer," where faculty with "great discoveries can attract venture capital" and bring ideas to market.

"This kind of expansion is absolutely necessary if the research at Penn is going to be an economic engine for our society," she said.

Asphalt parking lots that once belonged to the Postal Service have been converted into 24-acre Penn Park, next to the Schuylkill Expressway, with athletic fields, tennis courts, and green space.

Where tennis courts used to be on 33d Street in front of the Palestra will soon be a 2.75-acre grassy expanse with tree-lined walkways and plantings, known as Shoemaker Green.

Farther south, at 34th and Spruce Streets, a paved parking lot will be transformed this summer and fall into another open green space, directly across from the Hospital of the University of Pennsylvania, as a place for reflection and a break for hospital visitors and staff.

With many students away for the summer, now is prime construction time and cranes and trucks are everywhere on campus. The top three floors are under construction on the Perelman Center for Advanced Medicine on Civic Center Boulevard. A new addition to Steinberg-Dietrich Hall is in the works for the Wharton School.

Silverman, the main law school building, is getting renovations. In April, a new law building, Golkin Hall, opened in the 3400 block of Sansom Street. It was an example of what's happening all over campus — taking a site that may have been a parking lot, or one-story building, and putting in something more substantial.

"One of our limitations with an urban campus is the insatiable desire and need to grow," said university planner Mark Kocent. "Where do you do that? One option is to look at sites that are underdeveloped, that might be parking lots or former one-story buildings."

The new Golkin Hall connects to Silverman Hall, the original law school, and "allows the entire law campus to be interconnected instead of being a series of separate buildings," said Anne Papageorge, vice president for facilities and real estate services.

Also on the drawing board are a neural behavioral life sciences building on 38th Street near Woodland and a 350-bed student residence hall on Hill Field along Chestnut Street. The College House residence will preserve green space by putting the dining area under a sloping lawn. The veterinary and dental schools are targeted for renovations.

Penn's current development plans are almost exclusively east of the university's western residential neighborhood. Over the years, there have been "pushes and pulls" in the relationship, said Barry Grossbach, who chairs the zoning committee of the Spruce Hill Community Association.

"There is a history here of positive cooperation and attention to the neighborhood, but as in any relationship between a large institution like Penn and a community with diverse opinions, there's always going to be some tension," he said. An example now is a proposed graduate-student housing development at 40th and Pine Streets. The site has long been a subject of contention and has prompted "vigorous discussion within the neighborhood," Grossbach said.

Penn leased the land to a private developer, who found that a building there was "on the local historic district register," Grossbach said. The Philadelphia Historical Commission recently ruled that the building can come down, but the site must be rezoned. "It's very complicated."

Key to Penn's development plans is the 23.1 acres of land across the Schuylkill, which is called Penn's South Bank.

"People have asked me over and over again, ‘Do you have any plans to cross the river?' And I would always say, ‘No, we have no plans, but if the right opportunity came, I would consider it.' This was the perfect opportunity," Gutmann said.

"It enables us to have a 23-acre plot immediately across the river from our campus, where we can expand our technology transfer and commercialization of discoveries by Penn faculty on very favorable economic terms. Ultimately, I think it could be our technology park," she said.

In the near term, the university will put a data center there, and already a couple of small start-up companies that were outgrowths of Penn's engineering faculty discoveries are in Grays Ferry.

"Core academic functions" will not move "because one of our major strengths as an educational institution is that any student here or faculty member can walk between schools on the campus in 10 minutes," Gutmann said. All back-office operations "have potential there, and we are already starting to do that — storage, off-site library storage."

DuPont wanted $26 million for its automotive-paint lab, manufacturing and testing facility, which closed in 2009.

Penn paid $13 million for the 250,000 square feet of laboratory, office, and warehouse space.

The property is "well-served by infrastructure, by utilities, which makes it more affordable because you don't need significant additional investment to bring utilities to the site," Papageorge said. "We have steam, power, gas. There is a lab building that we believe with some renovation can serve chemical, chemistry-type research."

The site has about nine buildings. Some may eventually be removed, and new buildings are envisioned, along with streets, and open space. The Schuylkill River Trail opened in that area this month, from 34th Street south more than a half mile.

"We will, as opportunities or uses or possible interested tenants appear, develop parcels," Papageorge said.

When Penn embarked on the two-decade campus development plan in 2006, Grays Ferry was not even a thought.

In the first five years, the university built or renovated 1.1 million square feet of space and spent $1 billion. The Penn health system spent $1 billion, and private developers invested $500 million on various building and renovation projects.

In the second phase, 2011 through 2015, the university estimates it will spend $1.1 billion, the health system will spend $500 million, and private developers will spend about $600 million.

In 2006, Brandywine Realty Trust purchased from Penn the 30th Street Post Office building, which now houses offices for the Internal Revenue Service. Brandywine leased the Postal annex land from Penn and built a parking garage.

On either side of the garage are two parcels, known as Cira South. Brandywine wants to begin construction in the next two years on a 30- to 40-floor office and mixed-use retail building at 31st and Walnut Streets, and a 20- to 30-story residential apartment building at 31st and Chestnut Streets, said president and CEO Gerard Sweeney. The ground is owned by Penn and leased to Brandywine.

"When we commenced this project it was before the economic downturn," Sweeney said, referring to Cira South. "We had hoped to start it by now. We are in the process now of both marketing and financing discussions, and we'd certainly hope to start those within the next couple years."

The next stage of the campus expansion will include building the additional research and teaching space, more student housing, improving connections with pedestrian walkways between West Philadelphia and Center City, and renovating older buildings to make them more environmentally sustainable or sound — such as replacing outmoded lighting in all campus buildings, Gutmann said.

"Over the last eight years, we have spent $200 million to $250 million a year for various capital building and renovation projects," the president said. "We paid for that through a combination of our internal savings, our revenue stream from what some of those projects can generate in terms of research, and gifts. It's all a matter of really good financial planning and also the kind of generosity we've gotten in our $3.5 billion campaign."

Friday, June 15, 2012

Philadelphia's Select Top Office Leases for Q1 2012

The following is an account of the Philadelphia market's select top five office lease transactions for the first quarter 2012.
Morgan Lewis & Bockius LLP leased 309,234 square feet at Market Street 1701 in the Market Street West submarket.
Accolade LLC leased 89,878 square feet at 660 W. Germantown Pike in the Plymouth Mtg / Blue Bell submarket. Brandywine Realty Trust represented the landlord.
DVFG leased 49,000 square feet at 1021 W. 8th Ave in the King of Prussia / Wayne submarket. 
Guardian Life Insurance Co. leased 35,754 square feet at 1605 N. Cedar Crest Blvd. in the Lehigh / Northampton submarket. Keystone Mercy Health Plan leased 31,344 square feet at 2 International Plz in Delaware County. NorthMarq Capital, Inc.

Wednesday, June 13, 2012

Comcast lease brings Keystone Property site to full occupancy

 by Natalie Kostelni
Comcast Corp. has signed a lease on 72,500 square feet at Executive Park at East Gate in Mount Laurel, N.J., bringing the building to full occupancy.
The media company had been in 44,000 square feet and added another 28,500 square feet at the building at 112 West Park Drive. The property is owned by Keystone Property Group of Bala Cynwyd, Pa., which bought the 114,000-square-foot building six years ago when it was a vacant data center. Keystone launched a series of renovations to the property including a new fa├žade and roof and all-new mechanical systems, among other upgrades. Harleysville Insurance is also a tenant in the building.
Full story:

Ten Penn Center Refinanced

"Ten Penn Associates LP secured a $65 million refinance loan for its Ten Penn Center office building located at 1801 Market St. in Philadelphia, PA.
HFF, Inc., a Pittsburgh-based provider of capital market services, arranged the refinancing.
Built in 1981, the 27-story office building features 28,856 square feet of retail space, 692,552 square feet of office space, and a restaurant. Ten Penn Associates acquired the building in 2006 as part of a joint venture with Sterling American Property, Inc. for $75 million.

Nine Net Leased Properties in Northeast Trade for $68.7M

"A portfolio of nine single-tenant, net-leased Walgreens retail properties located in the northeast have sold for $68.7 million, for an average per-square-foot price of almost $699.

The portfolio totals nearly 100,000 square feet, spanning Connecticut, Massachusetts, New Hampshire and New Jersey, including the Philadelphia and New York MSAs. The nine properties include:
980 Farmington Avenue in Berlin, CT
1036 West Main Street in Branford, CT
880 North Montello Street in Brockton, MA
1 Glenwood Avenue in Dover, NH
17 Crystal Avenue in Derry, NH
897 Main Street in Melrose, MA
20 West Kings Highway in Mount Ephraim, NJ
1131 US Highway 46 in Ledgewood, NJ
500 Egg Harbor Road in Sewell, NJ

"This portfolio represented a rare opportunity for an investor to acquire a large portfolio of long term triple net leased Walgreens properties and we were able to achieve a sale price within one percent of the asking price.Walgreens properties with over 20 years of lease term are one of the most sought after assets in the single tenant net lease market, and we had strong demand for this portfolio."

The Keys to Investing in REITS (Video)

Tuesday, June 12, 2012

Service by Air Leases 14,671 SF in Folcroft

 Service By Air negotiated a lease agreement for 14,671 square feet of flex space located at 514 Kaiser Drive in Folcroft, PA.
Service By Air, was the tenant,  Barthco Associates was the owner, in this multi-year transaction. Aggregate rental of the lease was in excess of $334,000.
According to their website, “Service by Air is a freight shipping and logistic service company”. 514 Kaiser Drive is a single-story 32,000 square foot flex/warehouse building that is situated in the Folcroft West Business Park. The building contains five loading docks, one drive-in door, public water and sewer and is conveniently located within 4.8 miles from the Philadelphia International Airport, with easy access to Routes 420, 291 and 95.

30 Acres Sell in Lehigh Valley

The disposition of 30 acres of land at 10 Emery Street, Bethlehem, PA (LVIP VII) was traded. The sale price of the transaction was $4,200,000.00.

The buyer was Liberty Property Trust, LP. “Liberty’s purchase of 30 acres is yet another example of their positive outlook on the Lehigh Valley market in general and the particular attractiveness of LVIP VII.”

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Thursday, June 7, 2012

Roadrunner To Open Terminals In Philly, Baltimore

Roadrunner Transportation Systems, Inc. opened two new less-than-truckload (LTL) outbound terminals serving the Northeast region of the U.S. A new terminal in Philadelphia will provide outbound service from southeastern Pennsylvania and southern New Jersey, and a new terminal in Baltimore will provide outbound service from the mid-Atlantic region, including the greater Richmond, VA area.

Both terminals opened June 4. The two new terminals expand Roadrunner’s footprint in the Northeast, building on the presence the company established a year ago with the opening of its first outbound terminal serving the New York metro area and New Jersey.

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Le Crillon Apts Sell for $14.8M

Midwood Investments & Development acquired the Le Crillon Apartments, a Philadelphia multifamily property located at 105 S 18th Street. The five-story building was purchased for $14.81 million, or about $644,000 per unit.

Le Crillon Apartments consists of 7 ground-level retail units and 16 residential units. The property totals 41,757 square feet, with the retail space totaling 12,791 square feet. The property is conveniently located in Center City, one block from Rittenhouse Square.

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Herring Properties Breaks Ground on 250,000-SF Industrial Bldg

Herring Properties broke ground on the single-story, 250,000-square-foot industrial building located in the Bristol Commerce Park at 2501 Green Ln. in Bristol, PA.
Airgas Safety, Inc. will occupy the entire facility once construction is completed. Projected completion date for the building is January 2013. Airgas purchased the 18.81-acre parcel of land from Herring Properties as a build-to-suit for $5.5 million in February 2012.

1031 Exchanges - All States are Not Created Equal

"A 1031 exchange gets its name from section 1031 of the Internal Revenue Code. This tax-deferral strategy is part of the FEDERAL tax code. Whether or not you can defer the state gain varies by state.

Several states have no state income tax so there is no need to report the exchange on a state return. Other states follow the federal tax code so you can defer the state gain through your 1031 exchange. A few still have quirks that you must buy a replacement property in the same state the relinquished property was located. And then there is Pennsylvania. The Commonwealth of Pennsylvania does not recognize 1031 exchanges so while you will defer the federal gain, you will have to pay the Pennsylvania income tax. For PA residents who sold property (anywhere) or non-residents that sold property in PA, the 2010 tax rate for individuals is 3.07%. Note you must typically file a state return where the relinquished and replacement properties are located as well as your resident state.

In recent years, many states have implemented a mandatory non-resident withholding tax that must be paid when property is transferred to a buyer. Those closing agents handling the conveyance to the buyer are required to withhold a certain percentage of the gross sales price in order to get a deed recorded. If you are doing a 1031 exchange, it maybe possible to obtain an exemption from the state but in most cases, you must apply for the exemption prior to the closing of your relinquished property. Some of the states that have a non-resident withholding tax and allow you to file for the exemption include:

New York
North Carolina
Rhode Island
South Carolina
West Virginia

New Jersey also has a mandatory withholding tax for non-resident sellers. However, there is no need to request an exemption. With the simplest of all withholding requirements, sellers can simply complete the Nonresident Seller’s Tax Declaration right at your closing. The closing agent will instruct you to check the box on number 7 and circle 1031.
If you received the exemption, you must file a state tax return to report your exchange.

Note that some states refuse the exemption if the seller has not been filing a state return to report the income and expenses associated with the relinquished property."
Full story:

New Acme Market in Bryn Mawr

The June 1 opening of the West Lancaster Avenue store capped a project remarkable not only for its rarity but also for how it reflects Acme's hemmed-in ambitions for growth despite unforgiving finances flowing from its corporate parent in Minnesota, where it is just one of several supermarket chains being managed nationwide.
Supervalu Inc., in fact, announced Wednesday that it would cut 2,000 to 2,500 positions at its 247 Albertsons supermarkets in California and Nevada starting a few weeks from now. Leading that effort is Dan Sanders, who took the helm of Albertsons earlier this year after having joined Acme as its president in 2010. (He was replaced locally by Keith Wyche.)
During his tenure at Acme, Sanders presided over hundreds of workforce reductions while steering a hoped-for turnaround of a chain where sales have declined but reinvestment capital has been at a premium.
The Bryn Mawr store, which replaced a smaller Acme on the same parcel, is considered a "flagship" by Supervalu: It looks the way many Acmes would if the company could pour tons of cash into its stores, many of which long predate flashier competitors that have moved into the region in recent years.
It has a prepared-foods wing that is, though on a smaller scale, similar to what shoppers have found alluring at Whole Foods, Wegmans, Giant, and other supermarkets, with a pizza stand, hot foods, even a counter serving up the famous sandwiches of South Philadelphia cheesesteak-and-pork outpost Tony Luke's.
The 37,000-square-foot market contains a more extensive produce section, has wider overall organic-food offerings, and a broad selection of gluten-free products — including a gluten-free deli counter, distinguishing it from the 64 other Acmes in the eight-county region.
The sales floor is twice the size of the Acme it replaced, said store director Nick Carides. But every inch was precious.
From adding a full kitchen to its prepared-foods wing to creating a more open, airy floor plan, the company maximized the space available. In a densely developed area such as the Main Line, land is scarce, and any new store must balance desire against available space.
Among the 137 workers is one of the chain's most skilled butchers, Carides said: a meat manager recruited from one of Acme's New Jersey stores to carve 4-inch, 5-inch, and other specially cut prime meats at a full-service butcher block.
How did Acme officials determine he was at the top of his game at butterflying and stuffing, say, pork roasts?
"We look at their performance," Carides said. "We look at their craftsmanship."
Company officials made decisions like these after analyzing customer demographic data around Bryn Mawr, as well as broader industry trends. That helped inspire Acme's produce overlords at divisional headquarters in Malvern to try something new at Bryn Mawr: "store door" delivery of organic produce.
Every morning, a fresh shipment of organic produce arrives at the store directly from a supplier in Philadelphia. That's key in a community such as Bryn Mawr, where the appetite for organics is decidedly strong.
"They foresaw that this was going to be a huge organic market," Maratea said.
Reviews of the new store were mixed.
"It's been great," said Carissa McIlwain, 33, a Bryn Mawr stay-at-home mom who had picked up salmon steak, lamb shoulder, corn, and other fresh foods Wednesday for a small dinner party. "It looks good. We'll see."
Another customer, however, Bryn Mawr psychologist Sally Holtz, was frustrated as she breezed through for party supplies.
"It doesn't have a lot of the things that the Narberth Acme has," she said, including a certain brand of cottage cheese that she prefers. She said she would reserve judgment until going through the entire store at least once.
Acme spokesman Steve Sylven said that a store redesign was under way in Newtown Square, and that another in Hockessin, Del., was scheduled to begin next month. But no additional new stores have been announced.

Sunday, June 3, 2012

TRG to hire 400, adds to office space

by Natalie Kostelni

Title Resource Group is hiring 400 people and taking more office space as it gears up for what it sees as a bullish future for the housing and refinancing market.

The company, a subsidiary of Realogy Corp., recently renewed a 1ease on 100,000 square feet at 3001 Leadenhall Road in a 10-year deal with Liberty Property Trust and signed another lease on 20,000 square feet at 1015 Briggs Road. It will move in to those offices in July.

It is negotiating to lease another 20,000 square feet not far from its Leadenhall Road headquarters but declined to divulge more details until the transaction is finalized.

The space underscores the confidence TRG has for its business going forward. The company is adding 300 new hires in Mount Laurel, about 70 new workers in Southern California and between 50 and 60 new employees in Houston.

“We are very optimistic from our standpoint,” said Don Casey, president and CEO of the company, which has a national footprint. Even though TRG is based here, it handles transactions from across the country.

Full story:

Allegheny Real Estate Associates buys a 5,500 SF childcare center

Allegheny Real Estate Associates buys a 5,500 SF one-story childcare center at 406 Sumneytown Pike, North Wales, PA. Previously the Property had operated as Short Stuff Daycare Center, and later as the Montgomery County Head Start Program.The School is opposite the Merck Pharmaceutical Campus at Sumneytown Pike & Dickerson Rd. in Upper Gwynedd Twp., Montgomery County, PA. The seller was  Blue Bell Investments, LP. Sale price was $485,000. Allegheny plans some renovations and will lease the Property to another childcare operator.

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